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 1. INTERNATIONAL   2. INDUSTRY
 3. FINANCE  4. POLICY
 5. TRADE  6. GULF

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TRADE

April 29 - May 05, 2002

TRADE GAP WITH SAARC IMPROVES

Pakistan's trade gap with Saarc member countries improved to $12.2 million during the July-January period of the current financial year against $36.6 million in 2000-01.

Official figures available, showed that Pakistan's exports to Saarc-member countries during the period stood at $132.759 million against $144.975 million worth goods imported from these countries.

Pakistan's major regional trading partner during the July- Jan period of the current financial year was India, followed by Bangladesh and Sri Lanka.

Country-wise trade break-up with Saarc member countries showed that Islamabad exported goods to India worth $33.618 million during the July-Jan period of the current financial year, while imported goods worth $113.611 million from India during the same period.

The average share of India in Pakistan global exports and imports during the same period stood at 0.7 per cent and 2 per cent, respectively.

Pakistan exported goods to Bangladesh worth $53.54 million during the first seven months of the current financial year, while Islamabad imported $13.784 million goods from Dhaka during the same period.

Thus the average share of Bangladesh in Pakistan's global exports and imports stood at 1 per cent and 0.2 per cent. Islamabad exported goods worth $42.863 million to Sri Lanka during the same period while imported goods worth $16.93 million during the same period this year.

DROUGHT RELIEF PLAN

The $360 million Drought Emergency Relief Assistance (DERA) programme, to be completed in three years, involves $200 million spending on import of oil and farming inputs, according to official sources.

Out of the $130 million World Bank contribution to DERA, major chunk of $45 million would be spent on importing petroleum and petroleum products.

An equal amount would be utilized to import fertilizer and other agriculture items in addition to importing animal vaccines, agriculture & water sector equipment and construction and power generating machinery.

Apart from this, the government, whose total contributions to the $360 million DERA comes to around $130 million, would spend some $110 million on importing drought induced fuel oil and other imports.

BANKS OFFER 'GENEROUS' LOANS TO SPINNERS

Banks continue to offer generous financial assistance to the spinners, contemptuously ignoring the value added textile sectors in matter of allocation of loans.

This approach of the bankers, many small businessmen in the textile sector complain, is defeating the objectives set in the 'Textile Vision 2005'. This is an operational plan prepared by the government to restructure textile industry, focus on value added sector and enable Pakistan's textile exporters to prepare for marketing beyond the year 2004 when entire system of textile export quotas would be dismantled.

Neither the Export Promotion Bureau nor the Board of Investment has ever bothered to take stock of the situation in the textile sector. None of the two agencies has come out with any analytical study to guide the textile exporters. Only the Textile Commissioner's Office has been doing some strategic exercises for the textile business.

DRAWBACK ON MILK PRODUCTS NOTIFIED

The Central Board of Revenue has notified duty drawback facility on export of milk products. The repayment of customs duty will be admissible in respect of the goods exported on or after December 14, 2000 , said a customs notification issued on Wednesday.

The duty drawback at a rate of Rs36.33 per kg will be available on export of Nescafe classic 25 grams and its raw materials Nescafe bulk KSX-15; Rs6.52 per kg on Nescafe for the 18 grams and its raw materials-Nescafe bulk KSX-15, artificial sweetener, alkalized coca powder, satiaxane-xanthan gum and milk flavour.

15PC GST LIKELY ON IMPORT OF FARM ITEMS

The government is likely to levy 15 per cent general sales tax (GST) on agricultural produce on their import from the financial year 2002-03. Well-placed sources told on Monday that the decision to this effect is expected to be announced in the budget of 2002-03.

The agriculture produce, which are most likely to be brought under the GST net included-bulbs, tubers, potatoes, onions and shallots, garlic, dried leguminous vegetables, shelled, whether skinned or split, live plants and seeds of vegetables, fruits and flowers, wheat and oats.

CUSTOMS START RELEASING RED CHILLIES

Customs have started releasing detained Indian red chillies from Monday after re-affirmation from the PCSIR and Department of Plant Protection that the commodity is free from any fungal disease or injurious insects.

An official in Appraisement Collectorate told that orders had been issued to the port authorities to clear the detained Indian red chillies. He said within next one or two days, around 100- 150 tons of chillies will be released.

MEDICINES' PRICES MAY BE DEREGULATED

If the government allows pharmaceutical companies to sell medicines at any price they like, and that tariff on the import of pharmaceutical raw material could be reduced from 10 to 5 per cent, than the companies will pay 15 per cent General Sales Tax.